A former Deputy Governor of the Central Bank of Nigeria , Prof.
Kingsley Moghalu , on Thursday said the level of political interference
by the FG in the operations of the apex bank was a major reason why the
economy went into recession .
Moghalu , who is now the President , Institute for Governance and
Economic Transformation , said this while delivering a paper at the
Annual Directors ’ Conference organised by the Institute of Directors ,
Nigeria .
He spoke on the theme , ‘ Implementing best corporate governance practices in Nigeria ’ s public and private sectors ’ .
He noted that the level of political interference in the governance
and activities of public sector corporations had robbed them of
independence.
This , according to him , has left the institutions too weak to set and
meet effective performance targets and focus on delivering real
stakeholder value .
He stated , “ The central bank that was led by his royal highness
(Emir of Kano , Muhammadu Sanusi II) is not what we are seeing today .
We have seen a lot of interference in the work of the central bank and I
say that that was a very important factor that led to the massive
recession that we have experienced in this economy .
“ Corporate governance has very real consequences for our livelihood,
for the quality of the economy and strength of the economy . ”
Moghalu said apart from political interference , the culture of
patronage in the Nigerian public sector governance had led to such
corporations being seen and utilised only as a reward system for
partisan politics.
This , he argued , had left the institutions with little or no
thought given to competence and performance of public corporations and
their boards .
He said the apex bank , in its current form , lacked a board , adding that this was inimical to its operations .
Moghalu stated , “ The central bank , in the last few years, has not
had a board . How is this possible that a central bank operates without a
board ? So how is the corporate governance being run ? Is it just by
the governor? Or is it by the governor and anyone who is not a member of
the board ?
“ That is a question of the rule of law . The central bank Act is
clear . It is one of the public corporations in this country that is
very strong from the way it was conceptualised .
“ So you have a very clear role for the board . The President’ s
approving authority comes up only in about three instances in the board .
One is in investment , the second is in currency and the third is the
auditors.
“ Most of the rest (approving authority ) lies in the board of
directors and if the bank doesn ’ t have a board , I find it very
problematic . ”
He cited the Nigerian National Petroleum Corporation as another
public corporation where massive financial obligations were being
undertaken without board approval .
This , he noted, was not good corporate governance .
He said , “ The failure of corporate governance to take off in
Nigeria’ s public sector is part of our country ’ s long -standing and
continuing crisis of governance.
Nigerian citizens who are shareholders of a commercial company will
demand accountability if those attributes are perceived to be absent ,
but they will not be as exercised by the failure of public corporations
because they believe that these institutions exist to serve vested
patronage interest rather than the public interest .
“ Examples include the evident and massive failures of corporate
governance in the Niger Delta Commission and the Nigerian National
Petroleum Corporation. ”
.
